“Personal finance is a lot more emotional than it is a math equation,” Rodriguez says. “Even though the numbers have to add up, you’ll never take action unless you feel strongly about something.” Sacramento, California, certified financial planner Pam Rodriguez suggests identifying what brings you joy, then crafting a financial plan to create more of those moments. If you want to buy a house to host friends and family, for example, identify how much you’ll need for a down payment and closing costs, then work toward that savings goal over time.
Eventually, though, groggy mornings and paltry savings proved unfulfilling. My partner and I decided to set goals and plan for them. We wanted to buy a house, which meant moving to a less expensive city so we could build savings. For several years, my main financial goal was to go out as much as I wanted and still have enough money left at the end of the month to cover rent.
TIP: Know your passions to know your goals. GET SERIOUS ABOUT GOALS
If you’re a hyperanalytical person, a detailed budgeting spreadsheet might suit you. But if you’re more hands-off, a budgeting app might do the trick. No matter how you budget, it’s important to at least understand the money coming in and going out monthly. TIP: Choose a budgeting system that reflects who you are.
For most of my 20s, my budgeting system was defined by the lack thereof. Eventually, I sucked it up and started tracking my spending. At first, I felt that I was slacking if I didn’t document where every penny went. But I quickly realized that keeping a simple budget was more my style. FIGURE OUT A BUDGETING SYSTEM
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